Org capabilities & corp culture


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Org capabilities & corp culture

  1. 1. Strategy Execution <ul><li>Building an organisation with: </li></ul><ul><ul><li>Competencies </li></ul></ul><ul><ul><li>Capabilities </li></ul></ul><ul><ul><li>Resource strengths </li></ul></ul><ul><li>Developing budgets & providing resources in critical value chain activities for strategic success </li></ul><ul><li>Establishing policies & procedures supporting strategy success </li></ul><ul><li>Institute best practices & push for continuous improvement </li></ul>
  2. 2. Strategy Execution <ul><li>Install support systems – communication, IT, financial discipline, clear roles & responsibilities etc </li></ul><ul><li>Link performance & good strategy execution to rewards & incentives </li></ul><ul><li>Supporting work environment & corporate culture </li></ul><ul><li>Developing internal leadership to improve strategy execution </li></ul>
  3. 3. Strategy Execution <ul><li>Organisation-building actions: </li></ul><ul><ul><li>Filling key positions with people </li></ul></ul><ul><ul><li>Building core competencies and organisational capabilities needed to perform value chain activities proficiently </li></ul></ul><ul><ul><li>Structuring internal work and combining with collaborative efforts with strategic allies </li></ul></ul>
  4. 4. Strategy Execution <ul><li>Core competencies emerge from skills and activities performed at various value chain points; when linked creates unique organisational capabilities </li></ul><ul><li>Convert core competencies into long term competitive advantage by repeating performances </li></ul><ul><li>Multiskill and multi activity character in core competencies involve: </li></ul><ul><ul><li>Managing human skill, knowledge & intelligence </li></ul></ul><ul><ul><li>Coordinating & networking different work groups, departments & collaborative allies </li></ul></ul>
  5. 5. Strategy Execution <ul><li>Senior management must lead and guide </li></ul><ul><li>Organisation building challenge should include developing new capabilities while strengthening the existing ones </li></ul><ul><li>Decisions whether to outsource or develop in-house capabilities involves: </li></ul><ul><ul><li>Relative efficiencies of non critical activities between internal and external sources </li></ul></ul><ul><ul><li>Safety of activities that can be delegated to external sources </li></ul></ul><ul><ul><li>Need to develop competitive skills in-house to create organisational capability </li></ul></ul>
  6. 6. Strategy Execution <ul><li>Matching structure to strategy involves: </li></ul><ul><ul><li>Strategy critical activities becoming the main organisational building blocks </li></ul></ul><ul><ul><li>Bridging organisational lines of authority </li></ul></ul><ul><ul><li>Coordinating efforts of individual & internal units </li></ul></ul><ul><ul><li>Networking efforts of internal units with external collaborative partners </li></ul></ul><ul><ul><li>What decisions to centralise or decentralise </li></ul></ul>
  7. 7. Strategy Execution <ul><li>Organisation structure: </li></ul><ul><ul><li>“ there is no one best way to organise” </li></ul></ul><ul><ul><li>For single business companies, functionally specialised structure has been popular. These work well when: </li></ul></ul><ul><ul><ul><li>Strategy critical activities closely match function specific activities </li></ul></ul></ul><ul><ul><ul><li>Minimal interdepartmental cooperation is needed </li></ul></ul></ul><ul><ul><ul><li>Drawbacks: functional myopia, empire building, interdepartmental rivalry, vertical layered management hierarchies </li></ul></ul></ul>
  8. 8. Strategy Execution <ul><li>Organisation structures need to be supplemented with: </li></ul><ul><ul><li>Interdisciplinary taskforce </li></ul></ul><ul><ul><li>Reward & incentives linked to performance </li></ul></ul><ul><ul><li>Empower cross-functional team / self-directed work teams to perform </li></ul></ul><ul><ul><li>Unify fragmented processes </li></ul></ul><ul><ul><li>Top management efforts to knit the work of different individuals and groups </li></ul></ul>
  9. 9. Strategy Execution <ul><li>Lean, flat and horizontal structures are responsive and innovative and suitable for strategic priorities like: </li></ul><ul><ul><li>Short design-to-market cycle </li></ul></ul><ul><ul><li>Multiversion production </li></ul></ul><ul><ul><li>Personalised customer service </li></ul></ul><ul><ul><li>e-commerce opportunities </li></ul></ul><ul><ul><li>Leadership position in global markets and/or industry </li></ul></ul>
  10. 10. Strategy Execution <ul><li>Lean, flat and horizontal structures involve: </li></ul><ul><ul><li>Fewer layers of management authority </li></ul></ul><ul><ul><li>Managers and workers empowered to act on their own judgment </li></ul></ul><ul><ul><li>Reduce cross-departmental fragmentation </li></ul></ul><ul><ul><li>Encourage collaborative partnerships </li></ul></ul><ul><ul><li>Increased outsourcing </li></ul></ul><ul><ul><li>Leaner staffing of internal support functions </li></ul></ul><ul><ul><li>Rapid use of e-commerce technologies and business practices </li></ul></ul>
  11. 11. Strategy Execution <ul><li>Strategy implementer’s action agenda is situation specific </li></ul><ul><li>Strategy implementation is: </li></ul><ul><ul><li>Action oriented </li></ul></ul><ul><ul><li>Challenges a manager’s ability to lead </li></ul></ul><ul><ul><li>Managing and motivating people </li></ul></ul><ul><ul><li>Achieving performance targets </li></ul></ul>
  12. 12. Corporate Culture & Leadership <ul><li>Corporate culture produces work climate to meet performance targets </li></ul><ul><li>Organisation’s culture emerges from: </li></ul><ul><ul><li>Beliefs senior managers advocate </li></ul></ul><ul><ul><li>Ethical standards expected of organisation members </li></ul></ul><ul><ul><li>Tone & philosophy underlying key policies </li></ul></ul><ul><ul><li>Tradition the organisation maintains </li></ul></ul><ul><li>Company culture originates from founders or other early influential leaders </li></ul>
  13. 13. Corporate Culture & Leadership <ul><li>Culture gets perpetuated by: </li></ul><ul><ul><li>New leaders reinforcing them </li></ul></ul><ul><ul><li>New employees encouraged to adopt & follow them </li></ul></ul><ul><ul><li>Stories of people and events illustrating core values and practices are told and retold </li></ul></ul><ul><ul><li>Organisational members are honoured and rewarded for displaying cultural norms </li></ul></ul>
  14. 14. Corporate Culture & Leadership <ul><li>Types of cultures: </li></ul><ul><ul><li>Strongly embedded (rigid & slow to adapt) </li></ul></ul><ul><ul><li>Weak & fragmented (self-serving politics, resistance to change and inward focus) </li></ul></ul><ul><ul><li>Adaptive (receptive to new ideas, experimentation, innovation, new strategies, new operating practices) – ideal for fast changing business environments </li></ul></ul><ul><li>Changing culture is tough and requires competent leadership at the top </li></ul><ul><li>The stronger the fit between strategy & culture, the less managers have to depend on policies, rules, procedures and supervision </li></ul>
  15. 15. Corporate Culture & Leadership <ul><li>Healthy corporate culture is ensured by: </li></ul><ul><ul><li>Training </li></ul></ul><ul><ul><li>Strict compliance </li></ul></ul><ul><ul><li>Enforcement procedures </li></ul></ul><ul><ul><li>Top managers practicing what they preach </li></ul></ul><ul><ul><li>Serving as role models for ethical behaviour </li></ul></ul><ul><ul><li>Value driven decision making </li></ul></ul><ul><ul><li>Social conscience </li></ul></ul>
  16. 16. Corporate Culture & Leadership <ul><li>Strategy-executing leadership </li></ul><ul><ul><li>Spend considerable time outside their office </li></ul></ul><ul><ul><li>MBWA – management by walking around </li></ul></ul><ul><ul><li>Gemba – close to the place of happening </li></ul></ul><ul><ul><li>Listening and talking to organisation members </li></ul></ul><ul><ul><li>Cheerleading </li></ul></ul><ul><ul><li>Picking up important information </li></ul></ul><ul><ul><li>Reinforce strategic fit corporate culture </li></ul></ul><ul><ul><li>Support champions of new approach </li></ul></ul><ul><ul><li>Practice & enforce high ethical standards </li></ul></ul>
  18. 18. THE HARD S’s S’s Strategy: the direction and scope of the company over the long term. Structure: the basic organization of the company, its departments, reporting lines, areas of expertise and responsibility (and how they inter-relate). Systems: formal and informal procedures that govern everyday activity, covering everything from management information systems, through to the systems at the point of contact with the customer (retail systems, call center systems, online systems, etc).
  19. 19. THE SOFT S’s Skills: the capabilities and competencies that exist within the company. What it does best. Shared values: the values and beliefs of the company. Ultimately they guide employees towards 'valued' behavior. Staff: the company's people resources and how the are developed, trained and motivated. Style: the leadership approach of top management and the company's overall operating approach.
  20. 20. Strategic Intent <ul><li>A company's ambition that reflects its near end goal. It should convey a sense of stretch beyond what the current resources and capabilities can achieve </li></ul><ul><li>Strategic Intent has three attributes: </li></ul><ul><ul><li>Sense of direction </li></ul></ul><ul><ul><li>Sense of discovery (differentiated from competition) </li></ul></ul><ul><ul><li>Sense of destiny (an emotional edge) </li></ul></ul><ul><li>Example: </li></ul><ul><ul><li>TATA's Rs One Lakh car </li></ul></ul><ul><ul><li>ITC's 100000 e-choupals </li></ul></ul><ul><ul><li>COKE: A coke within the reach of every human being on the planet </li></ul></ul>